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India - Key Statistics, Telecommunications Market and Regulatory Overview

Attention: There is an updated edition available for this report.

India continues to be one of the fastest growing major telecom markets in the world. It is also one of the largest. Sweeping reforms introduced by successive Indian governments over the last decade have dramatically changed the nature of telecommunications in the country. The mobile sector has grown from around 10 million subscribers in 2002 to pass the 900 million mark in early 2012. Events in 2012 were to see a correction in the market, but overall growth was continuing. GSM technology continued to dominate the mobile market in India; while CDMA was clings to a declining market share of around 13%. Growth in the mobile industry was expected to continue at least into the medium term, boosted by the allocation of 3G licences in 2010 and the large scale roll-out of networks in 2011. On the other hand the impact of the unfolding scandal over the awarding of 2G licences in 2008 was looking grim for the mobile industry. Court decisions and the subsequent responses of the regulators are key to the eventual outcome. Re-auctioning of the 2G mobile licences was set for late in 2012. The fixed-line market, which had grown strongly for a while, began experiencing zero and negative growth. In terms of online access, there has been a fresh effort to promote broadband internet throughout the country; after a period in which broadband development languished, there was new hope for a serious expansion phase in this segment of the market. The impact of mobile broadband had also started to filter through the market. In the meantime, the government has been continuing to push to complete the restructuring of the telecommunications regulatory regime. The opening up of the market to full scale competition has been dramatic; however, major challenges remain.

This report presents the key measures and takes a general look at India’s telecom market together with the direction it is heading. It also considers the evolving regulatory landscape.

Key developments:

Overall growth in India’s telecom market remains strong; mobile market going through a period of uncertainty; the 2G corruption scandal, as well as being embarrassing for the government, has caused problems for all stakeholders in the industry; the potential damage to foreign investment in India is just one issue causing concern; broadband internet continues to see strong growth; broadband services have reached 60% of all internet services; wireless broadband systems have been helping increase the penetration of broadband across the market place.

Companies covered in this report include:

Aircel/Dishnet, Bharti Airtel, Loop Mobile (BPL Mobile), Idea/Spice, Reliance Communications, Tata Teleservices, Vodafone Essar, Uninor (Unitech), Videocon, S Tel, Bharti Telenet, Reliance Infocomm, Tata Teleservices, Sistema (Shyam Telelink), Swan Telecom, Videsh Sanchar Nigam Ltd (VSNL), Bharat Sanchar Nigam Ltd (BSNL), Mahanagar Telephone Nigam Ltd (MTNL), Videocon.

1. Synopsis
2. Key statistics
3. Country overview
3.1 Background
3.2 Economy
3.3 Analysis: India in the aftermath of the global financial crisis
4. Telecommunications market
4.1 Overview
4.2 Competition
4.3 2G scandal
4.4 Value Added Services (VAS)
4.5 Third Generation (3G) auction
4.6 WiMAX/wireless broadband spectrum auction
4.7 Foreign investment
4.7.1 Import of Chinese telecom equipment
4.8 Universal service
4.9 Government revenue
5. Regulatory environment
5.1 Telecommunications authorities
5.1.1 Ministry for Communications (MoC)
5.1.2 Department of Telecommunications (DoT)
5.1.3 Telecom Commission
5.1.4 Telecom Regulatory Authority of India (TRAI)
5.1.5 Telecom Dispute Settlement & Appellate Tribunal (TDSAT)
5.1.6 Telecom Sector Ombudsman (TSO)
5.1.7 Communications Commission of India (CCI)
5.2 Licensing circles
5.3 Regulatory developments
5.3.1 Overview
5.3.2 ‘Local content’ rules
5.3.3 Supreme Court ruling on ‘distribution of national assets’
5.3.4 Censorship issues
5.3.5 New spectrum policy
5.3.6 Tariffs
5.3.7 Penalties for delayed roll-out
5.3.8 Spectrum ‘vacation’
5.3.9 Cancelled licences
5.3.10 Access Deficit Charge (ADC)
5.3.11 Excess bandwidth fees
5.3.12 Unified Access Services Licence (UASL)
5.3.13 Basic Telephone Service (BTS) licensing guidelines
5.3.14 The ‘fixed’ mobile story
5.3.15 Offshore investment
5.3.16 The Blackberry privacy case
5.3.17 Spectrum charges
5.3.18 Spectrum in 2014
5.4 National Telecom Policies
5.4.1 National Telecom Policies 1999 (NTP-99)
5.4.2 Addendum to NTP-99
5.4.3 New National Telecom Policy
5.4.4 National Broadband Policy 2004
5.4.5 Universal Service Obligation Fund (USOF)
5.5 National security
6. Related reports
List of Tables and Exhibits
Table 1 – Country statistics India – 2012
Table 2 – Telecom revenue and investment statistics – 2009
Table 3 – Telephone network statistics – March 2012
Table 4 – Internet user statistics – March 2012
Table 5 – Broadband statistics – March 2012
Table 6 – Mobile statistics – March 2012
Table 7 – National telecommunications authorities
Table 8 – India’s GDP real growth rate – 2006 - 2013
Table 9 – Fixed-line services versus mobile services and penetration – March 2012
Table 10 – Foreign Direct Investment in telecom sector – 2004 - 2011
Table 11 – Telephone services to villages – March 2012
Table 12 – Number of telecom licences issued by category – 2007 - 2008
Exhibit 1 – Overview of FDI policy for India’s telecom sector

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